The Securities and Exchange Commission (SEC) is set to commence regulation of fintechs operating or seeking to operate in the Nigerian capital market and will launch a regulatory incubation (RI) programme towards the end.
According to a circular published on the commission’s website, the initiative will be launched in the third quarter of 2021 and will operate by admitting identified fintech business models and processes in cohorts for a one-year period.
“The RI program comprises two phases of participation – an initial assessment phase and the regulatory incubation phase.
“The categories to be admitted into each cohort will be determined based on submissions received through the fintech assessment form and communicated ahead of each take-off date,” the SEC noted.
It further stated that the review of completed Fintech Assessment Forms will continue on an ongoing basis.
“FinTechs who consider that there is no specific regulation governing their business models or who require clarity on the appropriate regulatory regime for seeking the authorisation of the Commission, are encouraged to complete the Fintech Assessment Form.”
The commission explained that it designed the RI program in order to address the needs of new business models and processes that require regulatory authorisation to continue carrying out full or ancillary technology-driven capital market activities.
It said the programme will serve as an interim measure to aid the evolution of effective regulation which accommodates the innovation by fintechs without compromising market integrity and within limits that ensure investor protection.
